Consolidating Financial Information

6 Months Ended

Jun. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

CONSOLIDATING FINANCIAL INFORMATION

CONSOLIDATING FINANCIAL INFORMATION

Certain of our subsidiaries have guaranteed our obligations under the $282 million outstanding principal amount of 8.75% notes due 2020, the $700 million outstanding principal amount of 7% senior notes due 2022, the $1.0 billion outstanding principal amount of 5.125% senior notes due 2023 and the $900 million outstanding principal amount of 5% senior notes due 2026 (collectively, the “notes”). The following presents the condensed consolidating financial information separately for:

(i) The Goodyear Tire & Rubber Company (the “Parent Company”), the issuer of the guaranteed obligations;

(ii) Guarantor Subsidiaries, on a combined basis, as specified in the indentures related to Goodyear’s obligations under the notes;

(iii) Non-guarantor Subsidiaries, on a combined basis;

(iv) Consolidating entries and eliminations representing adjustments to (a) eliminate intercompany transactions between the Parent Company, the Guarantor Subsidiaries and the Non-guarantor Subsidiaries, (b) eliminate the investments in our subsidiaries, and (c) record consolidating entries; and

(v) The Goodyear Tire & Rubber Company and Subsidiaries on a consolidated basis.

Each guarantor subsidiary is 100% owned by the Parent Company at the date of each balance sheet presented. The notes are fully and unconditionally guaranteed on a joint and several basis by each guarantor subsidiary. The guarantees of the guarantor subsidiaries are subject to release in limited circumstances only upon the occurrence of certain customary conditions. Each entity in the consolidating financial information follows the same accounting policies as described in the consolidated financial statements, except for the use by the Parent Company and guarantor subsidiaries of the equity method of accounting to reflect ownership interests in subsidiaries which are eliminated upon consolidation. Changes in intercompany receivables and payables related to operations, such as intercompany sales or service charges, are included in cash flows from operating activities. Intercompany transactions reported as investing or financing activities include the sale of the capital stock of various subsidiaries, loans and other capital transactions between members of the consolidated group. In 2015, the Parent Company acquired the common shares of a non-guarantor subsidiary from another non-guarantor subsidiary at a cost of $145 million. The transaction was settled by the cancellation of intercompany balances between the Parent Company and the transferring non-guarantor subsidiary. In addition, in 2015 the Parent Company capitalized approximately $90 million of intercompany receivables from a non-guarantor subsidiary with a corresponding increase in equity of the subsidiary.

Certain non-guarantor subsidiaries of the Parent Company are limited in their ability to remit funds to it by means of dividends, advances or loans due to required foreign government and/or currency exchange board approvals or limitations in credit agreements or other debt instruments of those subsidiaries.

	Condensed Consolidating Balance Sheet
	June 30, 2016
(In millions)	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Assets:
Current Assets:
Cash and Cash Equivalents	$	275	$	55	$	808	$	—		$	1,138
Accounts Receivable, net	805		177		1,493		—			2,475
Accounts Receivable From Affiliates	—		494		—		(494		)	—
Inventories	1,360		144		1,229		(47		)	2,686
Prepaid Expenses and Other Current Assets	51		3		113		2			169
Total Current Assets	2,491		873		3,643		(539		)	6,468
Goodwill	—		24		412		124			560
Intangible Assets	118		—		20		—			138
Deferred Income Taxes	1,926		19		83		—			2,028
Other Assets	231		88		380		7			706
Investments in Subsidiaries	4,304		427		—		(4,731		)	—
Property, Plant and Equipment, net	2,375		249		4,363		(27		)	6,960
Total Assets	$	11,445	$	1,680	$	8,901	$	(5,166	)	$	16,860
Liabilities:
Current Liabilities:
Accounts Payable-Trade	$	870	$	138	$	1,635	$	—		$	2,643
Accounts Payable to Affiliates	318		—		176		(494		)	—
Compensation and Benefits	326		29		250		—			605
Other Current Liabilities	294		18		551		(8		)	855
Notes Payable and Overdrafts	—		—		145		—			145
Long Term Debt and Capital Leases Due Within One Year	6		—		340		—			346
Total Current Liabilities	1,814		185		3,097		(502		)	4,594
Long Term Debt and Capital Leases	4,324		—		1,421		—			5,745
Compensation and Benefits	642		96		655		—			1,393
Deferred Income Taxes	—		1		89		—			90
Other Long Term Liabilities	483		11		136		—			630
Total Liabilities	7,263		293		5,398		(502		)	12,452
Commitments and Contingent Liabilities
Shareholders’ Equity:
Goodyear Shareholders’ Equity:
Common Stock	262		—		—		—			262
Other Equity	3,920		1,387		3,277		(4,664		)	3,920
Goodyear Shareholders’ Equity	4,182		1,387		3,277		(4,664		)	4,182
Minority Shareholders’ Equity — Nonredeemable	—		—		226		—			226
Total Shareholders’ Equity	4,182		1,387		3,503		(4,664		)	4,408
Total Liabilities and Shareholders’ Equity	$	11,445	$	1,680	$	8,901	$	(5,166	)	$	16,860

	Condensed Consolidating Balance Sheet
	December 31, 2015
(In millions)	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Assets:
Current Assets:
Cash and Cash Equivalents	$	354	$	70	$	1,052	$	—		$	1,476
Accounts Receivable, net	814		136		1,083		—			2,033
Accounts Receivable From Affiliates	—		609		—		(609		)	—
Inventories	1,199		157		1,152		(44		)	2,464
Prepaid Expenses and Other Current Assets	42		3		105		3			153
Total Current Assets	2,409		975		3,392		(650		)	6,126
Goodwill	—		24		407		124			555
Intangible Assets	118		—		20		—			138
Deferred Income Taxes	2,049		19		73		—			2,141
Other Assets	216		81		350		7			654
Investments in Subsidiaries	4,088		383		—		(4,471		)	—
Property, Plant and Equipment, net	2,377		216		4,213		(29		)	6,777
Total Assets	$	11,257	$	1,698	$	8,455	$	(5,019	)	$	16,391
Liabilities:
Current Liabilities:
Accounts Payable-Trade	$	1,002	$	189	$	1,578	$	—		$	2,769
Accounts Payable to Affiliates	540		—		69		(609		)	—
Compensation and Benefits	411		29		226		—			666
Other Current Liabilities	328		16		547		(5		)	886
Notes Payable and Overdrafts	—		—		49		—			49
Long Term Debt and Capital Leases Due Within One Year	6		—		579		—			585
Total Current Liabilities	2,287		234		3,048		(614		)	4,955
Long Term Debt and Capital Leases	3,796		—		1,278		—			5,074
Compensation and Benefits	725		97		646		—			1,468
Deferred Income Taxes	—		1		92		(2		)	91
Other Long Term Liabilities	529		15		119		(2		)	661
Total Liabilities	7,337		347		5,183		(618		)	12,249
Commitments and Contingent Liabilities
Shareholders’ Equity:
Goodyear Shareholders’ Equity:
Common Stock	267		—		—		—			267
Other Equity	3,653		1,351		3,050		(4,401		)	3,653
Goodyear Shareholders’ Equity	3,920		1,351		3,050		(4,401		)	3,920
Minority Shareholders’ Equity — Nonredeemable	—		—		222		—			222
Total Shareholders’ Equity	3,920		1,351		3,272		(4,401		)	4,142
Total Liabilities and Shareholders’ Equity	$	11,257	$	1,698	$	8,455	$	(5,019	)	$	16,391

	Consolidating Statements of Operations
	Three Months Ended June 30, 2016
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Net Sales	$	1,788		$	476		$	2,025	$	(410	)	$	3,879
Cost of Goods Sold	1,328			430			1,475		(420		)	2,813
Selling, Administrative and General Expense	234			38			321		—			593
Rationalizations	3			—			45		—			48
Interest Expense	79			3			22		—			104
Other (Income) Expense	(1		)	—			7		14			20
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries	145			5			155		(4		)	301
United States and Foreign Taxes	49			2			37		5			93
Equity in Earnings of Subsidiaries	106			1			—		(107		)	—
Net Income (Loss)	202			4			118		(116		)	208
Less: Minority Shareholders’ Net Income	—			—			6		—			6
Goodyear Net Income (Loss)	$	202		$	4		$	112	$	(116	)	$	202
Comprehensive Income (Loss)	$	190		$	(1	)	$	86	$	(84	)	$	191
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—			1		—			1
Goodyear Comprehensive Income (Loss)	$	190		$	(1	)	$	85	$	(84	)	$	190

	Consolidating Statements of Operations
	Three Months Ended June 30, 2015
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Entries and Eliminations			Consolidated
Net Sales	$	1,974		$	568		$	2,640	$	(1,010	)	$	4,172
Cost of Goods Sold	1,466			520			2,056		(1,015		)	3,027
Selling, Administrative and General Expense	242			42			366		(2		)	648
Rationalizations	5			—			40		1			46
Interest Expense	83			6			37		(16		)	110
Other (Income) Expense	(36		)	(1		)	8		42			13
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries	214			1			133		(20		)	328
United States and Foreign Taxes	85			2			35		(2		)	120
Equity in Earnings of Subsidiaries	63			(67		)	—		4			—
Net Income (Loss)	192			(68		)	98		(14		)	208
Less: Minority Shareholders’ Net Income	—			—			16		—			16
Goodyear Net Income (Loss)	$	192		$	(68	)	$	82	$	(14	)	$	192
Comprehensive Income (Loss)	$	223		$	(60	)	$	127	$	(32	)	$	258
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—			28		7			35
Goodyear Comprehensive Income (Loss)	$	223		$	(60	)	$	99	$	(39	)	$	223

	Consolidating Statements of Operations
	Six Months Ended June 30, 2016
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Net Sales	$	3,472		$	910		$	3,989		$	(801	)	$	7,570
Cost of Goods Sold	2,561			823			2,960			(830		)	5,514
Selling, Administrative and General Expense	476			76			657			(1		)	1,208
Rationalizations	5			—			54			—			59
Interest Expense	147			6			53			(11		)	195
Other (Income) Expense	(5		)	1			(10		)	40			26
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries	288			4			275			1			568
United States and Foreign Taxes	105			(1		)	63			4			171
Equity in Earnings of Subsidiaries	203			21			—			(224		)	—
Net Income (Loss)	386			26			212			(227		)	397
Less: Minority Shareholders’ Net Income	—			—			11			—			11
Goodyear Net Income (Loss)	$	386		$	26		$	201		$	(227	)	$	386
Comprehensive Income (Loss)	$	434		$	6		$	241		$	(234	)	$	447
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—			13			—			13
Goodyear Comprehensive Income (Loss)	$	434		$	6		$	228		$	(234	)	$	434

	Consolidating Statements of Operations
	Six Months Ended June 30, 2015
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Net Sales	$	3,814		$	1,088		$	5,242		$	(1,948	)	$	8,196
Cost of Goods Sold	2,909			992			4,159			(1,967		)	6,093
Selling, Administrative and General Expense	468			82			710			(4		)	1,256
Rationalizations	5			—			56			1			62
Interest Expense	166			12			68			(29		)	217
Other (Income) Expense	(201		)	(16		)	19			79			(119		)
Income (Loss) before Income Taxes and Equity in Earnings of Subsidiaries	467			18			230			(28		)	687
United States and Foreign Taxes	172			7			65			(1		)	243
Equity in Earnings of Subsidiaries	121			(60		)	—			(61		)	—
Net Income (Loss)	416			(49		)	165			(88		)	444
Less: Minority Shareholders’ Net Income	—			—			28			—			28
Goodyear Net Income (Loss)	$	416		$	(49	)	$	137		$	(88	)	$	416
Comprehensive Income (Loss)	$	416		$	(26	)	$	65		$	(54	)	$	401
Less: Comprehensive Income (Loss) Attributable to Minority Shareholders	—			—			(1		)	(14		)	(15		)
Goodyear Comprehensive Income (Loss)	$	416		$	(26	)	$	66		$	(40	)	$	416

	Condensed Consolidating Statement of Cash Flows
	Six Months Ended June 30, 2016
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Cash Flows from Operating Activities:
Total Cash Flows from Operating Activities	$	(243	)	$	(11	)	$	151		$	(17	)	$	(120	)
Cash Flows from Investing Activities:
Capital Expenditures	(185		)	(44		)	(239		)	2			(466		)
Asset Dispositions	—			—			1			—			1
Decrease in Restricted Cash	—			—			11			—			11
Short Term Securities Acquired	—			—			(34		)	—			(34		)
Short Term Securities Redeemed	—			—			23			—			23
Capital Contributions and Loans Incurred	(93		)	—			(243		)	336			—
Capital Redemptions and Loans Paid	25			—			143			(168		)	—
Total Cash Flows from Investing Activities	(253		)	(44		)	(338		)	170			(465		)
Cash Flows from Financing Activities:
Short Term Debt and Overdrafts Incurred	—			4			124			(4		)	124
Short Term Debt and Overdrafts Paid	(4		)	—			(36		)	4			(36		)
Long Term Debt Incurred	2,051			—			1,232			—			3,283
Long Term Debt Paid	(1,523		)	—			(1,408		)	—			(2,931		)
Common Stock Issued	3			—			—			—			3
Common Stock Repurchased	(150		)	—			—			—			(150		)
Common Stock Dividends Paid	(38		)	—			—			—			(38		)
Capital Contributions and Loans Incurred	243			59			34			(336		)	—
Capital Redemptions and Loans Paid	(143		)	(25		)	—			168			—
Intercompany Dividends Paid	—			—			(15		)	15			—
Transactions with Minority Interests in Subsidiaries	—			—			(7		)	—			(7		)
Debt Related Costs and Other Transactions	(22		)	—			(1		)	—			(23		)
Total Cash Flows from Financing Activities	417			38			(77		)	(153		)	225
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			2			20			—			22
Net Change in Cash and Cash Equivalents	(79		)	(15		)	(244		)	—			(338		)
Cash and Cash Equivalents at Beginning of the Period	354			70			1,052			—			1,476
Cash and Cash Equivalents at End of the Period	$	275		$	55		$	808		$	—		$	1,138

	Condensed Consolidating Statement of Cash Flows
	Six Months Ended June 30, 2015
(In millions)	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Entries and Eliminations			Consolidated
Cash Flows from Operating Activities:
Total Cash Flows from Operating Activities	$	231		$	(14	)	$	75		$	(18	)	$	274
Cash Flows from Investing Activities:
Capital Expenditures	(184		)	(16		)	(251		)	3			(448		)
Asset Dispositions	—			—			8			—			8
Increase in Restricted Cash	—			—			(6		)	—			(6		)
Short Term Securities Acquired	—			—			(49		)	—			(49		)
Short Term Securities Redeemed	—			—			21			—			21
Capital Contributions and Loans Incurred	(12		)	—			—			12			—
Other Transactions	—			—			5			—			5
Total Cash Flows from Investing Activities	(196		)	(16		)	(272		)	15			(469		)
Cash Flows from Financing Activities:
Short Term Debt and Overdrafts Incurred	43			5			49			(48		)	49
Short Term Debt and Overdrafts Paid	(5		)	—			(86		)	48			(43		)
Long Term Debt Incurred	455			—			661			—			1,116
Long Term Debt Paid	(658		)	—			(654		)	—			(1,312		)
Common Stock Issued	18			—			—			—			18
Common Stock Repurchased	(52		)	—			—			—			(52		)
Common Stock Dividends Paid	(32		)	—			—			—			(32		)
Capital Contributions and Loans Incurred	—			12			—			(12		)	—
Intercompany Dividends Paid	—			—			(15		)	15			—
Transactions with Minority Interests in Subsidiaries	—			—			(1		)	—			(1		)
Debt Related Costs and Other Transactions	(1		)	—			(9		)	—			(10		)
Total Cash Flows from Financing Activities	(232		)	17			(55		)	3			(267		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			(6		)	(55		)	—			(61		)
Net Change in Cash and Cash Equivalents	(197		)	(19		)	(307		)	—			(523		)
Cash and Cash Equivalents at Beginning of the Period	674			89			1,398			—			2,161
Cash and Cash Equivalents at End of the Period	$	477		$	70		$	1,091		$	—		$	1,638